Portfolio highlights lack of commercial properties

9:38 AM Monday August 1, 2016Colin Taylor

Unit 4 at 40 Arrenway Drive, Rosedale, is within a group of eight modern units.

Planned A-grade buildings for the commercial sector and increasing investment in the city’s industrial periphery are not keeping pace with the demand for more premises, says John Urlich, commercial manager for Barfoot & Thompson Commercial.

In the foreword to the agency’s second Insite portfolio for this year, Urlich says the leasing market continues to see increasing pressure on vacancy rates which are already at historic lows.

“The promise of lower interest rates continues to drive our commercial property market which is continuing this year in growth mode,” he says.

“It features properties in the Auckland CBD and down to Pukekohe in the south, Green Bay in the west, Bucklands Beach to the east and Silverdale in the north,” says Urlich. “The portfolio also contains a property from New Plymouth and one from Paeroa.”

Methods of marketing the properties are similarly varied with seven going to auction, five for tender, four being sold by deadline private treaty, 15 for sale by negotiation and nine for lease.

A prime commercial property featured on the North Shore is Unit 4 at 40 Arrenway Drive, Rosedale, which is being marketed by commercial sales agent David Goodhue and which will be auctioned at 10am on Thursday, August 25, at Barfoot & Thompson Commercial’s Kitchener Street offices unless it sells earlier by negotiation.

The 125sq m stratum in freehold property with three car parks is zoned Industrial D and is leased toan independent IT professional services company, which has occupied it from 2013 paying annual rent of $29,840 plus outgoings, plus GST.

The early 1900s character villa at 481 Parnell Rd has both commercial and residential prospects.

“The current tenant has renewed its lease till 2018 with further rights of renewal for two years,” Goodhue says.

“The office with a mezzanine floor was constructed in 2004 using modern tilt-slab and modern building techniques and is within a group of eight loft-styled commercial units with retail units below which are all fully tenanted and front onto Triton Drive.

“This sale represents the opportunity to purchase a property with a strong and long history with its current tenant in an area boasting the lowest commercial vacancy rate it has ever seen,” says Goodhue.

The property is situated on the corner of Arrenway Drive and Triton Drive only minutes from the Greville Road State Highway One motorway interchange and close to the Albany Mega Centre. “This location will also be positively impacted by significant infrastructure projects like a bus station planned for the northern bus lane along Arrenway Drive feeding the Mairangi Bay office precinct,” says Goodhue.

In contrast to the modern Rosedale unit, the Insite portfolio contains an early 1900s two-storey character villa at 481 Parnell Rd that is being marketed by John Stringer and Jack Atherton as having both commercial and residential prospects.

“The property is available with vacant possession and has multiple options,” Stringer says. “Commercial users could occupy both floors, or just one and rent the other out. Alternatively, the new owner could live in the first floor and operate a business from the ground floor.”

The 225sq m villa occupies a 330sq m freehold high-profile site and comes with three car parks. It has a frontage to Parnell Rd of 10.4 metres and is located on the western side of Parnell Road between Domain Drive and St Marys Close, in a pocket of character buildings between Newmarket and Parnell.

“We estimate the potential annual rent on a commercial basis to be in the vicinity of $88,000 plus GST and outgoings,” Atherton says. “This is based on $350 per sq m net rental for the building and $60 per week for three car parks.”

The property is zoned Residential 7B under Auckland Council’s Operative District Scheme and zoned Business Mixed Use under the Proposed Auckland Unitary Plan (PAUP) with a maximum height restriction of 16.5 metres – about four storeys high.

Across in West Auckland at 125 Godley Rd, Green Bay, a very different property housing an established automotive repair workshop, is for sale through Duane Mullooly and Chris Peterson who are selling it by deadline private treaty closing at 4pm on Thursday August 18 unless it sells earlier by negotiation.

“This freehold 1745sq m site is leased to an established tenant and provides a steady holding income,” says Mullooly. “It has an excellent frontage of 62.5 metres along Godley Road and represents a golden land-bank opportunity for long-term development.”

Comprising a building mix of mechanical workshop and office areas totalling around 230sq m, the site is zoned Mixed Housing Urban under the PAUP.

The property is leased to Godley Road Auto Limited for a term of five years from September 30, 2013 with five further rights of renewal of three years each and generates total passing income of $27,810 plus outgoings and GST. Rent reviews are every two years to the Consumer Price Index.

Peterson says the property is well-located midway between Blockhouse Bay and Titirangi. “State Highway 16 is accessible via Great North Rd, about 8.4km away, while State Highway 20 can be accessed via Maioro St around 7km to the east.

“The area will be positively impacted by significant infrastructure projects and specifically the Waterview motorway connection which will complete the Western Ring Route connecting Manukau in the south with Albany in the north.”

In Albany is another industrial property featured in the portfolio - Unit F at 20 Gills Road in the Albany Village Industrial Park.

Chase Erceg and Matt Kirkbride are marketing the vacant stratum-in-freehold property for sale by auction at 10am on August 25 at the offices of Barfoot & Thompson North Shore Commercial, 129 Hurstmere Road, Takapuna. It will not be sold prior to the auction.

“This is a tidy warehouse structure with associated offices and amenities which appears to have been built circa 1986,” says Erceg.

The building totalling a net lettable area of 455.4sq m comprises 284.33sq m of warehouse space, a 57.4sq m office area, a 94.72sq m mezzanine floor and storage of 18.95sq m.

“Unit F is a rear unit in a development of six units, bordering a reserve and encompassing a universal warehouse accessed via a roller door,” Kirkbride says. “Positioned to the front corner is the main office and reception area followed by partitioned offices behind. Other site improvements include three phase power supply and reticulation and onsite parking for six vehicles.”

The property is zoned Business 9 under the operative district plan and Light Industry under the PAUP.

Also having a mechanical workshop on site, but across the harbour bridge in the eastern suburbs, is a freehold property of 2744sq m that has been held by the same family for over 65 years at 149 Bucklands Beach Road, Bucklands Beach.

“The property is superbly located in an affluent neighbourhood within walking distance of both Bucklands Beach and the Eastern beaches,” says Rob Taylor who, with colleague Eric Koh, is marketing it for sale by tender closing at 2pm on Tuesday August 16, unless it sells earlier by negotiation.

“EB Motors, the mechanical workshop tenant has expressed an interest to continue its tenancy,” Taylor says.

The property earns total annual rent of $85,730 including income from four, two-bedroom flats – one currently vacant – and a storage building on the rear portion of the site with a separate access way.